After a long period of silence on the subject, Elon Musk, billionaire entrepreneur and CEO of Tesla and SpaceX, has once again turned his attention to Dogecoin (DOGE), a cryptocurrency he has supported in the past. Using his platform on X (formerly known as Twitter), Musk recently engaged in a conversation about Dogecoin’s inflation model, reigniting interest in the digital asset.

Musk: "Dogecoin's Inflation Is a Feature, Not a Bug"

Responding to a discussion initiated by Dogecoin co-founder Billy Markus, Musk defended the inflationary nature of the cryptocurrency. Unlike Bitcoin, which has a hard cap of 21 million coins, Dogecoin's supply is unlimited, with a fixed issuance of 5 billion DOGE per year. This model has become a point of contention among cryptocurrency enthusiasts, with critics arguing that it devalues ​​the coin over time.

Musk, however, has a different take on this feature. “Dogecoin’s steady inflation—its decreasing inflation rate—is a feature, not a bug,” he commented. According to Musk, this structure encourages Dogecoin to be used as a transactional currency, making it less valuable than Bitcoin and more suitable for everyday use.

Billy Markus Weighs In: Inflation Can Be Adjusted, But Should It Be?

Billy Markus, although no longer directly involved in Dogecoin development, has clarified that the inflation model is technically subject to adjustment. He mentioned that any significant change would require a formal proposal and consensus between the community and miners.

Markus also expressed fatigue with the constant questions about inflation, suggesting the topic remains divisive. “While it is possible to limit inflation, it requires broad community support. Personally, I am fed up with this debate,” he said.

Market Reaction: Bitcoin Takes a Hit

Musk’s comments on Dogecoin appeared to have a ripple effect across the entire cryptocurrency market. Shortly after his post, Bitcoin (BTC) took a slight dip, falling from around $93,000 to $91,880. While the exact cause of the drop remains unclear, Musk’s influence on the cryptocurrency market, often referred to as the “Musk Effect,” cannot be underestimated. His comments have historically led to significant price movements for both Dogecoin and Bitcoin.

The Future of Dogecoin is in the Spotlight

Elon Musk's endorsement of Dogecoin's inflation model has once again thrust the meme-inspired cryptocurrency into the spotlight. His assertion that stable inflation could be beneficial fits into his broader vision of Dogecoin as a viable alternative for everyday transactions.

As the cryptocurrency community debates the merits of the inflationary versus deflationary model, one thing is clear: Dogecoin remains a polarizing but indispensable part of the cryptocurrency landscape. With Musk’s continued support, its journey is far from over.